How this Delhi-based laundry-on-demand platform broke-even operationally in less than eight months

If you live on your own, owning a washing machine to take care of just your laundry load is not desirable. Gaurav Agarwal faced the same predicament when he started working in Odisha, away from home and the washing machine, and he found the local laundry service to be unreliable. Indeed, this is a problem many working professionals who live away from home face.

Sensing a potential business idea and figuring out the primary target group, Gaurav did some research on the supply side and found the perfect solution: laundromats. These small processing centres with washing machines and tumblers are installed across the city by private businessmen who were also in need of more business, as they were operating below capacity. Gaurav decided to aggregate laundromats on one platform and take control of quality, which solves major pain point for the users.

Gaurav, along with Ankur Jain and Samar Sisodia, launched Pick My Laundry in May 2015. “We were the second player in this segment. With our service in Gurgaon and south Delhi, we saw an exceptionally good response from users,” says 25-year-old Gaurav.

With time, they realised that other groups, namely working couples, housewives, HNIs and senior citizens, were also using the service and giving them great business.

Taking on challenges

A challenge Pick My Laundry came across was trying to meet the time slots for clients.

However, with the use of technology, it is trying to eliminate this challenge. “In this immature market, customer expectations need to be met in the best possible manner, considering the costs involved. We cannot do dry cleaning at the cost of laundry and hence it will take some time for consumers to get accustomed to professional laundry services,” says Gaurav.

Business metrics

Starting out with Rs 10 lakh, the startup spent it on rents and marketing. The founders did not have to spend a whole lot on in-house logistics and technology.

The platform got more than 7,500 app downloads in two months. It is currently processing around 2,500 clothes on a daily basis and is associated with 10 processing centres, working closely with them on quality and time schedules.

Sixty-five percent of customers are repeat patrons at Pick My Laundry . It is growing at 25 percent month-on-month and will soon be covering the entire NCR and other cities. “Unlike others, we have adopted a sustainable business model. We are not banking on discounts but services,” says Gaurav, adding that the business is operationally breakeven.

Recently, it raised its seed round of $100,000. Pick My Laundry is now looking to raise its pre-Series A round, and is getting interest from a few HNIs and early-stage VCs within India and abroad.

Estimated growth

For customer acquisition, the startup uses word-of-mouth publicity and referrals. Affiliates like Urbanclap, Helpchat, and Timesaverz also give it leads at low acquisition cost. It is also creating multiple channels for marketing, done with little effort on a daily basis.

The sector is huge and the space is hot. With average spend of Rs 800 for a month for a person, the platform estimates a revenue of $3 billion from the target group within Tier-I and II cities.

All home services are going to rise and laundry has the highest traction and frequency of usage. It is a vertical business and requires special attention to nurture and grow.

As part of its offering, Pick My Laundry is working on bringing services like in-a-day delivery and overnight delivery for laundry and dry cleaning services. It’s currently operational in Delhi-NCR and aims to scale up its services across other parts of the country soon.

Market and competition

According to KPMG reports, unorganised laundry in India is a Rs 2.2-lakh crore opportunity and is set to grow even bigger, as the pool of 12 million online consumers from metro cities will continue to increase at a compounded annual growth rate (CAGR) of 20 per cent.

Startups like Wassup and Tooler are the other two players in the segment that cater to the laundary segment. Besides, Doormint, Wassup, Tooler including some horizontal platforms like Housejoy, SBricks and Zimmber also offer laundry service.

On competition, Gaurav says that while there are many online laundry service players in the market, Pick My Laundry has set its own standards. It has a quick turnaround time which is its big USP. “We follow a hub-and-spoke model and have an internal agreement with laundry partners who take care of quality standards and time commitments.”

YourStory take

In the past one year, laundry service segment has witnessed a lot of restructuring in the business. Doormint has pivoted from on-demand home service to laundry service. Many other home service startups have now also included laundry in their services.

The segment has also seen plenty of ups and downs. Last year, media ran the news of Naspers investing in the Indian laundry service segment. However, the sentiment did not run high for long as news of more acquisitions than funding captured the media later.

The laundry service segment has been trying to consolidate its position, but so far has failed to do so. Amazon investing in home services provider Housejoy and the latter acquiring My Wash indicate a trend of domination by the big fish. Smaller players need to find a sustainable revenue model to survive.